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New Residential Investment (NRZ)

Participants
Kaitlyn Mauritz Head of Investor Relations
Michael Nierenberg Chairman, , Chief Executive Officer and President
Baron Silverstein President of NewRez
Nick Santoro Chief Financial Officer
Bruce Williams CEO of NewRez
Kenneth Lee RBC Capital Markets
Trevor Cranston JMP Securities
Henry Coffey Wedbush Securities
Bose George Keefe, Bruyette & Woods
Eric Hagen BTIG
Kevin Barker Piper Sandler
Stephen Laws Raymond James
Call transcript
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Operator

Good day and welcome to the New Residential Second Quarter 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions]. I would now like to turn the conference over to Kaitlyn Mauritz, Investor Relations. Please go ahead.

Kaitlyn Mauritz

Great. Betsy. you, Thank everyone. morning, And good I'd like the us for for thank Residential's second you New call. joining quarter today to XXXX earnings

morning. here Residential CEO going the was Throughout of the Nierenberg, to Michael and Baron New reference our today this website of and to NewRez; Financial posted me NewRez. President Chief Williams, of Santoro, Residential; that morning, Chairman, Bruce earnings Officer; call this supplement Silverstein, President New Nick Joining CEO are we are

you've so, download If done the presentation to already encourage you not I'd now.

and the out forward-looking and Michael, differ Before may reports I'd certain I encourage you over forward-looking their call will factors to risk turn filed review the annual supplement release by statements. and with uncertain materially to statements today earnings and review the disclaimers from I'd nature, to in like press contained These are statements, actual our in to SEC. point results. quarterly statements be the regarding that our

In non-GAAP these addition, financial I'll call A Michael. measures measures comparable with to directly element. our we'll of And can over call. today's GAAP earnings the most be that, reconciliation found measures in the during turn discussing be to some

Michael Nierenberg

for thanks us. Thanks, morning, everyone. Kait. Good And joining

was The one. a second our quarter for company good very

purchase. book While before quarter-over-quarter our When maintain markets our the are stable value, challenging, to it grew capital caliber value earnings. actual the created and we you related book think about raise

line with were taking Our in in core account earnings QX into $X.XX dilution.

for rate The the in we game our our is $X.XX. feel the which changer that I is you interest announced And company take frankly, roughly environments. a away well extremely quarter very quite So the our dilution company. acquisition early earnings industry. core if for Caliber positioned strongly low

are in compete position now anybody. against a to We

companies, to will us shareholders the come. the able the products to be both different both personnel results excellent of offer further companies, with to homeownership. sheer dream across the scale and for Caliber helping all enable leadership business drive side our of our to of of many the channels, technology years will on The homeowners We of for

rates While the they stay rates we company our coupled rise will production with that in we to rise believe excellent the will machine slowly levels, these the grow capture interest MSRs. extent us around enable portfolio our combined or of to

We business. excited our operating are super about

side, the a portfolio investment great continues the do On job. to team

Our financing been better. business has never

financing than We market moved our away have to all MBS. essentially if daily agency most other not mark of from

EBO we is MSRs. going business businesses level forward on EBOs Essentially would of call what our portfolios this I Our call back REITs, call continues pre-COVID and our proprietary and to levels with grow. rates to will focus own

this family We seeking homes single and capital currently markets will patient have deploy of XXXX rates in and deployment we level been to on remain are today spreads business rental the capital credit a On opportunistically. have where with homes. acquiring

leader weeks. intend Looking forward, grow the this great really will we we in announce and hired management and a team have upcoming business that to

and we view, force see rates macro hand should will our strong some point Regarding Feds the higher the economy ahead. at

has purchases, should and Powell for economy begun. from signals that improved while the mentioned committee asset we earnings. are higher we clock anything the ready they the are create on our The and and As will business Chairman maintain here will before yesterday operating stay has tapering

and very lines. investment the and maintain ability price, in on confident Regarding earnings business combination drive of our to and operating our our we companies our Through higher a feel earnings future. stock

I'll our will lines. published has to write been recent taken with equity While our which stock ahead on prices itself. now raise our I'm value potential hopefully our currently book weeks at after the capital in going refer XXXX back help supplement in billion, paid capital shareholder inception going When X. a approximately page since $X.X current company equity in of dividends billion you since about time billion. with and XX% inception, $X $X.X start we to return think market today, book our earnings

the we the On owner servicing these bank to in our non And side mortgage company are On have of new only. mortgage we assets. largest are $XX investment billion and reads numbers specific rights. portfolio

non-bank did pre-tax During billion status QX we a $XX.X of $XX.X And top our origination, as we in million. income maintain originator. XX mortgage

complimentary service. Residential. with income an portfolio apart? I'd Page do our same pre-tax we maintain How of to And businesses. set us we manager non-bank everybody XX X, as as top $XXX like million. investment status servicing a billion, the New operating again, Our ourselves $XX.X mortgage think

call that our think mean? what does When rights. about we have So portfolios, we

We have MSR portfolios. our

we We continue as linked our we in look and which at hunt opportunistic side, think MSR ourselves our are have When portfolios. operating the to company about for to EBOs opportunities mortgage investors.

drive and rise believe the portfolio believe On which help and do MSR we and as go we when higher we more flow if value, opportunity higher net core book forward. rise that earnings we cash will have rates significant upside will net they

has sheet balance stronger. Our never been

be and sheet. country other our out We rolling the homeowners. combination NewRez that and earnings drive we and with that the products $X.X arm have think machine you new of with we three will when just we caliber balance product originator to ability help can investments, of cash higher announced growing. non-QM billion expect and When we operating purchase top purchase, cash, of plenty in about products, of about for Caliber think to we're the believe a will we that We we and our mortgage create to when plenty about liquidity about likely liquidity think whatever four about and homeowners end after think create recently or or help the

and assets track shareholders will Our our delivering Again, or create go the income GAAP for the this equity track a million from to Caliber financial five, offering we again that reflects record, the to when our of look fund $X.XX highlights dilution net to of add as generating of share. is out then our since business portfolio ability quarter $XXX XX% And we purchase. income did forward. diversified before our returns further diluted pointed per record we earnings at I to inception. Page $X.XX

So of diluted roughly diluted of $X.XX. at book reflects pre $X equity the essentially, $XX.XX we June, of dilution where end look or X.X% bit on And value, yield that hand $XXX could value June think over end it per the stock of as equity billion. little about today net When $XXX.X dividend earnings of again, from as million at cash that $X.XX consistent you same, book million. per our equity offering. share, $X.XX with $X.XX. the you a issuance of share the $X.XX Core think dividend Common were, as

versus So it would that $XX.XX put quarter at $XX.XX. prior

rates And in is we simple total fund higher look will expand billion then When we acquisition economic poised at to and our just of the early portfolio recapture in Page the EBO and offering perform purchase, on Page raise is significantly, $XX.XX we environment. pre-capital April. $XX.XX to earnings the rate Again return call equity strategies capital loan Again X.X%. any in in our I how our about look drive value. hope the our a Our in post for X think strategies in quarter dramatically. rates gain deployed MSR company our X this positioned walk Caliber close the do quarter today pretty rise we If $XXX us originate, any environment. business. is Caliber book results? rate enable to to when which to the $X.X quarter rates. we we million percentages think our announcement

our of Our daily just portfolio. sheet balance mark-to-market sales X% total is exposure

On the we increased our quarter. NewRez previous up XX%. the XX% refinance recapture That's roughly rates of from side, to

Our direct to channel. consumer

despite fact QX. modest, in that rates the the a quarter we While the in backed had is gain gain actually up

We rights markets. which we called call since the collapses our mark-to-market Our and in QX the highest from to to capital and financing call collateral of saw MSR the shift $XXX portfolio, amount in continue million in quarter non-mark-to-market and strategy, we of bank rights XXXX.

Page are how the XX%. for we NRZ MSR So financing X profile all numbers acquisition; Caliber again current at it. of to are is and specific these NewRez. And paying

the to Caliber As Caliber purchase $X.XXX after from We're and cash the I pointed are start proceeds follows; as rates, XXXX company. we cash liquidity. again, agency of and earlier, will liquidity acquisition. liquidity of sheet. and to April liquidity do out result and on funds the including a both occurred from is paying acquisition to the we out our known equity The from parent in company. have origination securities liquidity closing the billion the billion how $X.X from caliber be equity with Caliber. sale combined and billion cash there billion expect projections about dividend which the cash then and has $X.X and price and already a and cash end we reduction post And calibers of balance that combined Page the that that's think will XX; purchase $XXX that to at expect to of of funding

bit $XXX billion. portfolio under servicing total a little Our

significant look see continue correspondent in on direct think for again that think and as consumer to lift at our at of as and earlier, our roughly numbers and I you and to overall forward slide it opportunity, to retail retail recapture grow we gain from direct going real results customers, numbers recapture we NewRez Here's The look company. about should you this think P&L channels. channels, been on Calibers XX%. consumer, of the be When XX% where we're changing compare margins production. recapture side we to have pointed our to and side, some about see and went to and out you terrific. direct XX% JV the retail those When go When the game we right the will wholesale more upper sale

results. So all all, in great

cash through wholesale XXX combined portfolio, servicing we MSR XXX more retail branches, all. direct drive retention. and from earning customer lenders have recapture loan system full partners, Page the party see our XXXX consumer retail XXX XX plus XXrd going X.X loan broker million portfolio correspondent As at in more customers we XXXX more flow and higher a platform. the to consultants, to clients; we're officers, MSR

good is two scale. have one not XX; volumes. increased about to revenue We to we're combination of go every this more and job. have to I team entire we once the at here. close way more really execute capture But technology of we Caliber Page lead Caliber our going through drive the we harping And we have cash on to side, improving and going done flow is think technologies Now a just we keep should companies. the cost have more what really going from call this to to the a others from around system Sanjiv on drive -- From which as synergies the I'm perspective economies deal. more and assist digitization bullet earnings. and the through a the

platform. around So we're prospect technology about excited the really the Caliber

untapped And we we We forward I work sources of clearly, we to we're to none from how Market think our we're that a sides. customer around while company. our go done of think going will thing here a in the think cross diversified volumes entire cost sell we're to offerings, product is page. want in think to about talk both I also going of we of we stuff capital XX. of the we're a ability gains again we all analytics will all right across improve on have base. see our expand think From highlight to across market, And Strategy, second here Capital, lot thing financing to data out have to base. really we our and that's significant side standpoint, The implement and on we funds our a in I customer execute. the going opportunities front. about lot one as the standpoint. And And share do have the Page the opportunity. bottom point capital. market that to technology we

$XX billion. XX will and As higher rate production. a early, did billion think X% roughly out $XXX in [indiscernible] it's we market add Think if an I way, do we go a about company And market that it this large we in environment. pointed extra through would share

between add up If about about net have for net billion just margins the that, the and in mix earnings and we there, think retail roughly production our product $XX and you JV XX% to if it's going of you a of think company. more

the to peers super again, business. on at we talked excited gain we street this And have and friends share. market So Page point. about our XX, the need again, in just everything

column middle think race special product and being and about you servicing all and currently services about the we and servicing in you If we're about talk you look when it at ancillary and you talk again. product doing mix have that a

us earnings to I Now I'm a on Page higher this. Similar it's execute get to in up. before. time drive price and to what going to stock be spend up for not that ton XX, shareholders going nature out pointed to of

Our platform we we about do from will [XX] profitability in and very our think platform great on strategy going growth to mortgage on have a lot retain as life implemented. service investment customers. be will we'll think of a Page platform, a things. that important. begin to grow for a expand a our and couple none. our customer of recapture our have continued rates side, there technology about the job When that. Caliber business portfolio, to continue work to again we investments XX the digital our to And customer standpoint. we We're and second How higher do that's have help standpoint very, drive Technology; portfolio,

mortgage Call this. we rights we to of still As billion have through spend leading call originator this. Think read going time rights. a more not about lot there. XX One

proprietary has call legacy $XX on the rights Nobody have market. billion of We non-agency that.

announcement mentioned run Ginnie about ability Mae from our be strategy acquisitions in single the we homes We're Ginnie from standpoint, an of to a XXX side five opportunity non-agency years. There to currently mentioned management weeks next to the billion great financing going again, have we perspective, legacy target more of we're collateral. new million as markets billion the in looking finance investment we team through EBO From deals. our ability also family none think I over couple beyond and investment think and will And in source a before EBOs XX to to a Our before that. page as $XX our second and capital balance more in quarter and a XXXX earnings that's are going Mae the business have drive EBO market. sheet. portfolio to I they called our $X rental on have quarter, the a in our

by We of Post units the XXX we agency purchased we our We of $XXX SFR grew sold XXX million securitize an cap During rate of residential with quarter million and securities million securities sold EBOs. agency of we portfolio of loans. million billion X.X%. and QX, XXX average X.X of $XXX residential loans.

billion on XXX% page $XXX as out the totaled Our non-daily June. origination. MSR XX MSR portfolio I new pointed On our our of earlier, are mark-to-market. of end at financings

New to QX. origination during compared X.XX% was quarter during X.XX% the

whack cash we're about and bit flow as this, higher earnings homeowners to time, here more to lower time. but desire QX, and believe leading we is be our slower these when will flowing, think rise interest So what you over of during the refinance lower lower changes will this little again rates the yes, to rates higher speeds trying over portfolio a $XXX than is as articulate

dark flow currently really and On third again we will portfolio NewRez servicing the being portfolios and rates couple party our speeds rates the Cooper, believe and friends platform, the gains XX cash summary since COVID just lead at in Page at MSR that our It's slowing bottom have you And think XX% days in at March further with in or serviced we and and portfolio our a origination think securitizations, markets. a right XX [indiscernible] capital of portfolio. about NRZ priced the servicing page. mind, financing. look LoanCare XXXX. relationships to keep portfolio a MSR seven the improving as about recapture how have others. XX% We of our side of then recapture is also currently our of of MSR we the

on and our in change, market actually, to a share. a or recapture value earnings in So lead a start change of rate X% with X% change change A change. for comments XX% common per X% portfolio a $X.XX will let's

on what recapture, again, focus to Page not earnings dead data calls horse here. recapture our huge beat of a huge digital since doing shareholders. amount higher XXXX. of I'm side on the to more clearly and and analytics, XX, focus on huge call right business. going drive focus on Largest we're Again, So a for QX

this I'm expect going credit loan to It's again interesting. our world our investment Call and We to look just out unmuted. broader advanced XX us going that think are own buy what think and will at business When our target the rights, you where continue to delinquencies EBOs proprietary lower trend page refer not for about balances as and about as to remain opportunities spreads is loans. collateral. we

Our of extent think mortgage opportunities pretty we When we businesses pipeline on will the in shrinking two in call you call market is what right also XXXX first that change interesting. on What are for to agency's a GSE back us things business saw the think GSE EBO saw occupied. The non-owner securities. that about deploy very mobile the interesting. a is during agency to a pull eligible of very is the with quarters footprint part provide robust capital early the agency we

the continue midwest, exposure, XXX,XXX create bottom owner to you southeast XXXX XX% opportunity look conforming again, southwest about us think rate average the targeting in we as little business. yields page, and mostly net could particularly shrinking SFR rate occupied units lifetime X.X%. our footprint. XX underwritten GSE to a loans. to the of cap for go Page a part XX%, in basis average left if balance currently, the geographic bit a forward, a as we another higher our for be part potential of and that Non-QM So non- environment growing will business

If you housing I have types a space. what about call have done different great know entering peers space this some and of would of in I a supply, think folks and firms this already lot and announced job

great Service think at our can some And to decreased has point what I will, opportunity here. the become. job during billion of HLSS when billion. outstanding lot month billion of for $XX billion financing about spend XX Baron $X.X XXXX back from have here and in had excited large team. will of this business team and why announcement with to take capital balances some to is we're through billion then up leadership again, mind time $X.X $X.X a advances financing with of we to we'll the going here. different we The on Page acquired that Baron keep you the $XX next and don't advances August They of questions. back continues a turn or not Average I of of couple open shrink done there. it operator amount to and these outstanding. advanced slides for

Baron Silverstein

Thanks, Mike. Good morning, everyone.

slide to Turning XX.

million XX.X division NewRez, quarter and origination ended billion. second funded income the we the volume at For with of pre-tax XX.X

to take and these business as advantage market such future broader grow continue our ongoing we of the the market themes I as recapture, performance deliver opportunities. we mentioned, to pressures quarter continue the that such market competition, of well-positioned during in headwinds, as our of margin Besides are on our impacted our build channels to Some number increased and growing just across a of aspects set. and all product

a quarter-over-quarter in over alone. with our production. business direct XX% gain momentum our announced consecutive our relaunch consumer billion, we quarter which continues June increase last in non-QM $XXX to grown we've sixth example, the which locked of For of X.X volume increased and million funded is record We business quarter to of

our in businesses levels jumbo into partnership, we we million quarter and lock well. and also to the coming have announcements JV non-agency with added XXth over as back volume JV quarterly additional pre-COVID third Our XXX

The other margins. important point is gain on sale

flattening margins sale have a on of decline we're points of quarter-over-quarter XX gain basis While decreased to beginning the margins. see

range including months from and XX business the in to it for remain March points margins bound direct three Our the past consumer July. dropped low basis XXX

by is and For the flattened our it's change in points wholesale in from entire have XX primarily June, driven basis Margins June July. from the corresponding bound but April have flattening remained seen Similar volume. July. the quarter, in approximately in as range first points a JV to including And in reduction the channel March and second July. the volume theme channel pressured since we margins for by mid purchase XXXX this channel quarter, dropped in refinance XX half and our in also margins basis of drop but

lot given rate ability we've However, the decline. last on driver continue The XX% opportunity adverse channel, corresponding it's servicing margin given this We which that accelerate as overall market significant the back come. margin some of new our the change companies are excited already platforms. to in talked looking two believe really to and our objectives to in that. FHFA of removal we're efforts will forward origination And to that volume, and Caliber July, raise mentioned, significant Michael to of have and slide combine about the a months fee, the gain and benefits share. seen goals take interest comment in about quarter-over-quarter for both a is size and is market the that

I've for for consumer long channel few continues our our to or huge focus past to direct present company. for a to opportunity this XX to Turning DTC NewRez quarters, remains slide say term NRZ and but and continued the a and

increase Our in recapture XX% fundings process seen can hold with increased taken changes that quarter-over-quarter. our statistics and refinance a our see have also but

DTC In message XX% improved consumer have of continue in to further see in our and visit refinance better we capacity, get our we The platform refinance grow. also consumers, all increase experience. by recapture. to and of our to to you will success. our I to to enhanced build as new brand we of the connecting XX% times marketing digital invite improvements our brand our NewRez launched our being April, our only originated customer NewRez.com That's scale awareness recapture, and our and increase a NewRez seen While critical originated loyalty a are churn importance recognition

channels any dollars XX, to originated flat our and highlights on the some was rates. with joint Turning other and just quarter environment continues to higher perform the interest in slide even business market for venture well quarter-over-quarter quick a billion

new branches relationships, market In in XX% where approximately approximately add out JV, products, in efforts and with before, non-delegated mentioned customers, volume to normalization focusing comprise with continue to purchase And on saw the which broker versus our new quarter. XX non-QM of building additional non-QM our announce channel, addition, our of including we venture the improve as we comprise newest return but In we mortgage joint company transactions I our non-agency XX% funded products add volume quarter. to best first focus also such margin, XX% which as corresponding add Coast One overall our and we also In LLC companies, we not operational Mortgage XX we our new with new wholesale only in efficiencies partnership a our through relationships by grow and [indiscernible] them welcome the partnership, clients. family. JV can continue which to creating NewRez platform second to customer customers our is channel, adding on

our So to our see units quarter we terms we progress. second performance, use other in think both performance the in when to evaluate great about of and metrics continue funding I

XX. to Turning slide

For increase million a second quarter income ended with of the quarter-over-quarter. servicing the division, X% we pretax XX

quarter-over-quarter XXX and to approximately servicing servicing is with a for business was billion table as we based a overall. mitigation loan continue and quarter million modest loss ended increase home. has the core the to servicing impacted showing continue strategy origination balance a and and added retain We aggregate cost our X.X also representing homeowners be then impacted in portfolio per which a growth achieve upon to proven pre-tax the We second to slightly, solutions income which on PTI customers NewRez their volatility COVID historical

X.X% their XXX,XXX CARES in quarter. On resolve COVID since was we've the portfolio versus pandemic, first XXX,XXX enacted, about the the last over the slide forbearance and helped over active our homeowners active loans our X.X% navigate first and remain forbearance act in XX or

remains focus these modification work to Gennie a mitigation newly Fannie, possible available Our every and engage of all on homeowners to including programs. Freddie method and programs series introduced loss

and line do in On Kait. to the more help continued industry but to with are homeowners. work numbers to Our that good back

Kaitlyn Mauritz

open for will line We the questions.

Operator

question comes first answer begin will ahead. Kenneth And Please session. from from go We Instructions] now Capital question Markets. [Operator RBC the and the Lee

Kenneth Lee

taking Hi, my good for morning, and question. thanks

Just one the sale on on gain margins.

the and JV the improvement some saw DTC channels. within You

and Just if talk what's driving that improvement. you just could wondering about elaborate Thanks.

Michael Nierenberg

flattening the I is seen a we've is delivered. mean, message

So reduction less mentioned hadn't if in seen each our business the of as I our we did they've we XXXX. points all dropped see in a channels June margins and flattened basis decline, channel but one TV in XX JV in at since any

in our bound as reduction seen I range but March, DTC points last a basis we've remain So also from for three business July. the they XX mentioned, months, including

Kenneth Lee

combined wondering Caliber Got driving estimate. the some you. volumes you've assumptions key Very the talk I that am helpful. if Thanks. and of had And just one estimated follow the NewRez. XXXX origination of up in for terms by there if about I you may,

Baron Silverstein

Right.

slide up So if XX, our underlying of the on can you on need which look each slide, think you on see to XX. just make at really slide it's channels that I estimate,

and retail no the on businesses, the is overlap. there So JV business

our So accretive. in view that's XXX%

nature They business, same. channels, actually accretive at third channels party both are managing look upon limited the their pleasant portfolio managing the and our significant And overlap a our the the very looked was about are business. On third servicing all the servicing at DTC surprises those is and analysis, there party of it's then of we we based portfolio. you that

example, NewRez the that their of our type been focus accreted. has of limited. not Caliber of customers broker the to in, So is on and for focused and very And channels is is our view and also is NewRez between on both direct then overlap in the focus, top meaning

interest current of as markets of So overlap described. our months of really our between our rate for from five is the view remaining forma two I upon year view and view companies, the our the just is the pro projection based our of

Kenneth Lee

very you Thank helpful. Very much.

Michael Nierenberg

Thank you.

Operator

KBW. ahead. Bose from comes George question with next Please go The

Bose George

about that portion you already. going size just Ginnie sheet ask on you've XXX that can EBO and slide, EBOs sizable Hello, where just good that MSR gains the purchased And of size opportunity. million quarter. it's this balance we opportunity Mae that your a morning. portfolio just help it? your is to Actually, just forward of give Cooper saw of us you the like and it's you've got seems the wanted In that first then I book XXX XX million mean, already billion

we see curious from opportunity. that just could what So

Michael Nierenberg

XXX we that the the about so great about, we I in will When you're think million go broader What cycle. believe sheet. opportunity have forward. we our obviously a balance between is credit on mean, origination

should change, exactly buyout be there EBO potential having However we billion, quoted opportunities portfolio a hard Ginnie it's of to and will loans Mae in business, redelivering, think and the the $XX what tell MSR is. things to some numbers I that some number

Penny billion is originator. that think you not CDMA it to that is about if So to up biggest match you way I think where think about is, the where or we're XX Cooper the probably

will Ginnie do over However, that time likely Mae exposure. grow our think I

happen in pretty depends So overall of lot where the again, dramatically credit the over the But therefore, with on that what's XXX million we time. it are of could a going cycle to and increase homeowner. I the think

Bose George

the so pool. XX debt for you've out that stuff repurchase this now, XXX delinquent million Okay, day of

So to that basically flows more right? the delinquent bucket, is the it's if extent there's into more,

Michael Nierenberg

out. that actually continues to flow numbers basis. on that The on the steady that's there's weekly steady is buying XXX we're an But there sheet to are that And on balance balance sheet. a overall our Correct. come massive flow

Bose George

that gain Okay, a the up the JV of you great. on MSR. And that follow then, just the excludes and in the on In to recapture say DTC gain Thanks. actually footnote, sale. question

So, or whatever, is I been was just XXX have saying gain the But that replace MSR? points through that just would that piece basis essentially flowing servicing mean, the last higher? instead, to the

Michael Nierenberg

Yes. That is correct.

if of as the we are So Cooper on the our and to prior number MSRs look booking what operating at in MSRs in differently does, a overall capture is our side their in mortgage business. origination that business other their you read being company

Bose George

your book value give quick you one quarter-to-date? Okay, great. an actually on one And Thanks. last can update then,

Michael Nierenberg

It's constant. pretty

pretty of where to today of were the to end QX. As it’s similar prior we

Bose George

Thanks. great. Okay,

Michael Nierenberg

you. Thank

Operator

Please The is with Eric from BTIG. next question go ahead. Hagen

Eric Hagen

lower differs how around amount servicing coupons. Good originated loans. wondering certain there's seasoning higher the guys loans the right such, recapture so new coupon in where strategy rates of now or note environments rates that And last thanks. book like over with the borrowers of year targeting Hey, looks a and the like have and fair I'm mix are The especially low. rates course, morning. on depending a of you season and

Michael Nierenberg

Baron, you that? want to take

Baron Silverstein

Yes.

number certainly consumers of So what we call I or leads, targeting based factors, including refinancing a based may upon different leads we or upon marketing interested just that continues trigger mean even are biggest a either a And that are be to buy borrowers in is our our looking money. the in strategy that focus. from home. perspective context to But the have of

that approximately of we So based overall we look the at as talking if current continue you a customers portfolio coupons of NRZ, at million MSR look about target. on to we're today, size the

Michael Nierenberg

thing look on the with NewRez would one I his are a side. the when to point out but not where the today, team at assembled only with also team side ago year we where were the on we Sanjiv you that Eric,

It's point a the to slides, who's those better areas I technology out homeowner you're going and think and as NewRez data and data add what analytics, we of ready and gains, XX%. numbers I a and from think really refinance, in to the huge going XX% identifying I couple that's lift. seeing to get analytics, continue one to on

giving So environment a company. rate significantly really our do I our higher if speeds in are higher I we going look earnings guidance an core and at we to end anticipated up earnings, in to are recapture rates, hate believe of slow core add but and down I the value forward, as overall going and our

Eric Hagen

for That's additional as Then just structure capital Caliber leverage Got guys has I capital no on the appetite debt. about how considering you that combine and guys platform's? it. one unsecured structure. wondering the helpful, the the thanks. mean, you I'm think

Michael Nierenberg

April currently the a coming now. expect the as be we'll of standpoint have sit it one equity evaluate by from business I really where the of down on in the I depending businesses it's the we while out opportunity I operating the based liquidity be to sheet subs, the would level, an we XX. to in drag we have more last a to like of debt don't know are think to of we bad deal standpoint lot I cash as at never the put earnings investment to grow us. cash look particularly actually of a because thing. best do need anywhere on as of give opportunistic saying and with our to is us We give evaluate fund or way parent the think on X.X and we our that what to days going It'll would that dark call did from what with corporate we we'll right when result QX from well continue call what expect they're liquidity balance this capital raise But Having billion acquisition and capital the we or as saw end March a and XX always operating protect where in continue what not shareholders upon structure more we for hat a to people markets an from we year.

Eric Hagen

very Got it. much. Thank helpful. That's you

Michael Nierenberg

Thanks Eric.

Operator

And the Please with go next ahead. JMP from Cranston question Securities. is Trevor

Trevor Cranston

so improved that's on. really this recapture and follow was up been continued rate you could sort that think nice was this of allowed in how a the for maybe guys potential the comment spike came on to about you in term. of there together Hey, the sort should that rate improvement grow more we question you quarter focused the something if have think thanks. much a Obviously, near specifically on about quarter. that I what and wondering Actually

Michael Nierenberg

marketing back to our made folks better improved very get marketing only The I people brought second. we and our and an like I some on we're have that's to frankly, but in we us think rates. excuse, a leading, we, just the mean getting company better. quite NewRez it's want a side we to ever and focus. for good person don't as XXXX have better I recapture better I really and great and go

about $X Shellpoint billion think company the in If I at combined billion. about Caliber the XXXX, look you is you acquisition, think XXXX, acquiring when going production their numbers $XXX to do

but So between growing frankly, we pains in better XXXX now, and have and better. getting we're just clearly quite

can on. where that's and should going But down to back a cents and $X.XX where why said, better. which earnings we're I couple point to down core to I speeds, to go to we I against and going think that's what $XX everybody get to portfolio So and it we of comments the one the back think focused when $X.XX, be ready because to prospects X% have just is get compete we and get grow printing of the core and to want you more book better if is continues at we're in look have lead we large I now. the where And recapture go, we're of MSR I slowing earnings back we're $XX and to a kind and to value $X.XX, to in higher made stocks

Trevor Cranston

Got it.

growth you're expanding strategy and management the run SFR Okay. a growth do to years? coming continued Or should couple particular And about of runoff think it operating about of motor? you maybe that platform business of portfolio you we fund to which about think of that where next that. from being anticipate from in guess, more on how new anticipating in you talked as capital then another that? Is of I some the bringing over coming the area that

Michael Nierenberg

in capital at homes asset good think Eric of XXX portfolio. million I again, and markets equity. have The asked have efficient other come a It is and the could point under currently we areas little from financing this a we pretty the question, XXXX of in bit that

of debt when we unsecured think liquidity, markets depending the we our would to need plenty very capital like you quarter, continue end QX at portfolio if look sheet upon what the about think So need without capital deal again into any of our we about quarter the we capital debt capital large are to like investments the during in XX dealer or something the preferred to XX grow that balance that. or what and and either think we, a expecting extent cash additional to to consider then we

Trevor Cranston

EBO early opportunity. sizing that does portfolio in Caliber any the the and one Caliber way? the everything, of the Okay, portfolio When then the got bring buyout you just opportunity And servicing it. one last clarify to mentioned size change does in or the of on include

Michael Nierenberg

Yes exponentially. it opportunity does. grows It does Caliber, obviously, not include With Caliber. the

Trevor Cranston

appreciate Great, the you. Thank comments.

Michael Nierenberg

Trevor. Thanks

Operator

with Sandler. The question from go comes ahead. Kevin next Barker Piper Please

Kevin Barker

you the you competitive announced? previous do on XXXX. runway morning. just dynamic Caliber there's think changed have think or us given Good your I estimate may Could in income that feel look like you update for give I still in what in that deal mean, origination would million anything you do market. like operating Caliber the a around you $XXX maybe was somewhere the earnings on expectations do when versus believe

Michael Nierenberg

Hey Kevin.

things. team have look going, our to or to his the the up and from and we a we're $XX are synergy going on Caliber, and on couple this think call discussed about financing a think, Sanjiv gain around haven't where standpoint be a realistically synergy this that forget from a alone, one year sale the and at able from I here's I perspective. we synergies. think margins, about wise, I and something compress financing And financing think I of thing discussions team had When pick million we're

deck think financing about $XXX highlight going and that's We million little on to annum why a side. our a are between in the $XXX we bit be something investor overall million So basis. synergies in our per

the we to gain think deal, sale margins gain or about kind we size when ‘XX, ‘XX sale So margin. on think on it we where about underwrote of that, when we are, ‘XX

we're as So line going about to and I we're forward we with see Baron thinking change ‘XX. we're more that. go as we're hopefully higher of ‘XX as any bringing actually how long better. we with earnings I and in don't complimentary together this only And teams going Sanjiv on both think get sides to lift in where and and the thing or see going

Kevin Barker

you of top us said that originally? to did XX XXX? you mean a I you more? you understand the can or in XXX you synergies due that help to bit million Could unpack million out little on that say XXX, financing. Is $XX And laid

Michael Nierenberg

synergies, on technology with we're million what think it's integration overall the I and we're million side be going between $XXX going a to financing basis. between do and be where able going to $XXX and something the annum to per

about to to of both around and to is is if could earnings financing. different the it's for shares overall It think identify around going And with Part that that earnings a of we continue going be truly space. lot around million part there's So to of you things that pretty will that of be Part is work within company. that that increase be organizations. things be it could on that that. core outstanding, synergies. sizable relate XXX and other

Kevin Barker

going XX/XX, income XXX probably described, from have to of is originally like We your million a have normalized on Caliber. XX more. a that and XXXX, synergies potential origination something add operating to market North similar expectation or stated you XXX of the million then to the XXX above market on

Michael Nierenberg

But in synergies. how XX to kind think plus we on top believe, on I deal go, to higher because what think XXX. XX/XX million the your total initial That's underwritten XXX core your numbers. operating synergies around with that to another much pretty And of was get XXX total to XXX million XXX assumption again, of to that consistent Caliber's just we income about math XXX we earnings. is where and the

Kevin Barker

Okay. Thank you. That's Thank you. helpful.

Operator

Raymond Please question next ahead. from from Stephen James. The go comes Laws

Stephen Laws

morning. good Hi,

Michael Nierenberg

Good morning.

Stephen Laws

morning. Good

and little bit or mainly allocation any Can XX capital anything or follow targets the as that? unit or growth all far southeast, about targeting a maybe really your SFR can you that quantify to on environment. sides or like competitive sector talk we X a you Can up of sourcing? that's pretty metrics, look month kind Just it as

Michael Nierenberg

that come, more we weeks XX units we make doing, have with. Stephen week. to new brand ready out in announcement a of Currently to broader I as are a say think couple would XX we'll a we a have including I to roll

team working now. a on have sourcing We this broad

We on that operating also technology pretty a have vast and we're with have side the we network. working partners

business couple have Guardian, If we we very I that is bought, a ago, NRZ a deck of who acquisition of that parent our number acquisitions. a because to business. Obviously, good a we put sides think a bought works but been along called alongside preservation get property the which SFR the as guess years of company our you to X we with operating out years billion third expect that's parties in running about are some we next over

We I a think just jumpstart deal [indiscernible] help us I are think would builders thinking you announced Homes]. with that there, saw about. with gladly initiatives would certain out [Invitation partner of which one home large we the

And the they'll to again, grow new who horse, we So enable with, come a more over team, will with in work a management proper come. closely business be with come to truly have time. there which the headcount, don't to the I want they will I lead but the will us. think us They in very plan, court have

Stephen Laws

that you we are Appreciate we And the if you question, to a follow talk about switch color. potential the the that refinance in Can as the or up how be upside as loans and and in on years? about quarter. next could gains do accretion over there fully volumes XXX calls about for those XX to much the ROE on how expected how lumpy the potential I the the there and know, do an couple and we going call that's think called maybe returns think but it then annual XX on were basis,

Michael Nierenberg

many these Nick out. let do I'll I episodic. So in are stuck loans to a been sec come is years for mean more it many, starting little bit a in though but comment have I pipelines these believe, that

for of So call back activity we've non-QM to of related at course deals past the issued, NPL was the when that the that we some years, example, RPLs, few in over go look that.

to side. Some legacy of its related the

back Nick, steady XXX about early call fantastic And frankly, that. talk go think to And I Nick way for or that in, one. the would a a points. we were math in business, get and about talk let I'll business. This last quite I'm want last this much average, if generally about XX/XX, simple But I factor sale to that XXX or to that we announced I one least us one. around the of where I we other on to which a loans in the million about was, been think, just forward. And think, about the probably we'll had cal I the a we thing has expect result anyway. quarter. one to around of better large at know state that points. didn't did just so out And, that million we as was we if where I is math last two billion you we then quarter. couple million our think do on, securitize, hopeful a one XXX But

like. it equity color wasn't was kind you'd The it So do whatever loan of securitized, on actually was huge. format. And return Nick, sold in

Nick Santoro

Sure.

approximately coming bit So little accretion Michael saw loan strategy. quarter different more as going in in where the That And side the is portfolio of generated earnings on quarter, today side. for do occurred to past our securitization calls a income we will $X.XX a call from in third result given is where the quarter. what of mentioned, in sale from is from come month income from July. The this the we the income mix more did we

the can the quarter. we our actually quarter in in at reflected that mark, second and recorded that see you not this from P&L look it's So when you loan

Stephen Laws

Great. you Nick very and thank much. Michael

Michael Nierenberg

Thanks Stephen. Stay well.

Operator

comes with next ahead. Coffey go Henry Wedbush. Please The from question

Henry Coffey

for Good taking call. my morning and thanks

them then operators larger JVs thoughts joining companies them you that. question. Some up? first. us are small of the some could The builders maybe what's of And home for independent Is are it, some incentive one questions give the around most of

Michael Nierenberg

monetize to comes pass income of and entire through that sales the their to what operators to to. those the we ventures They rest comes work looking owner our the loan any down it to retail force really joint the of realtors, references really basically on origination do lead rules through of our through that's officers. U.S. basically down Most across Yes. from mortgage And are JV partners it kind

Henry Coffey

just you Alright. – Are these gen generating companies or that doing are for lead

Michael Nierenberg

home. No. their their within help to looking consumers real loan They basically buy or with make they are loan offices. officers this These buy to estate are partnership just estate brokers. And directly effectively and office officers real their those with ventures referrals working partnership our their and our consumers joint we

Henry Coffey

And on are margins that gain of front the on we some sale and going have any there sort stability August where as on comment wholesale late. July seen given in then of

Michael Nierenberg

the that of we've March including the quarter We mentioned drop saw July. our seen April, we've to from margins and I basically stability stable channel for Yes. and quarter. basically seen a wholesale the rest for

Henry Coffey

Mike, then, big And you for a question.

had one mean, I you time. to that going be, time would rates to takes to All it for the put if ingredient etc. you take It's together. to interest of etc, up, take could this primary it is “time” go businesses going accelerate, because time

trigger margin earning your is dividend a are seeing for You healthy an the and there? logical what by increase

Michael Nierenberg

Henry, it's a great question.

price. a take about we equity at when our company at I that I try to think back and today think I our and step I'm look looking

as here. going some writing call, am down I this notes through we're So

to and equity when value lower after We deal, harvest change. raise. capital where value I at equity June now, and when a it's it's came we and back raised Our take now XX at around to gets announced in took to give Stock announced goes back out, hit we book on capital everything. in which the think We did book or our Caliber XX.XX XX.XX, base you a look

rush operating second through into in very to integration. think I'm you the does I to We we're be none, time about we nor going want company want I where confident As have about don't anybody. life that. a go and When talk with business, to great-great the that'll time, to rush

an have has team, through place and second Bruce, for. our excellent done that to this management when we close business the get team none. job Sanjiv's hit want and great the we So management to and his we back when we running. we ground my us, both that's excellent teams final here, But to to And us get credit operating operating the and that so Baron a business and far no getting we you thought have at have look

getting rights. We EBOs I it have a We business, business call done I whether lot in but business, his of go. team not business the as properly channels, again, I relates talk valued, and to the the investment think proprietary the where gain it has our be operating investment think about can think or we're on

lot frankly. to dividend amortization the our question policy about do. have that increase to I going look I go and think because is trends for big when So and about think in And all at as I us current at work now do recapture, and we forward, short $X.XX $X.XX, we quite $X.XX, the we I'm a forward not earnings that of how look

operating others an certain We have business, businesses dividends, operating pay don't.

how in we shareholder that happy. and our What a right out to want everybody hopefully we'll come the and to for work get see We drive and Do interesting businesses news the Absolutely. think think hard dividend it's time really investment increase? reassess the Caliber and have and through the about that's then valued We But for we'll like properly paying and a operating put portfolios who get to as makes a then we a very rate results. that frankly good I some company that it's are now. us Absolutely. closing, the And $X.XX quite with everything have get we think I our we'll question. teams there? company

dividend get there. future. question the really when. like. policy out in question It's is of the we'll that is look think And far is So then a what this don't I our

Henry Coffey

and XXXX digested in we a look can till you Caliber's something we year is you sense of wait the is that have everything about or next and the to up this bigger Is harass something really fall like? and you when should running going what

Michael Nierenberg

you think harass can anytime. me I

Henry Coffey

Okay.

Michael Nierenberg

book goal our an up growth results XX.XX bring price very great that and trading where I'm XX.XX or in and stock we're So with we frustrated up. our with put the because book I

right reason we And we I and we $XX be be $XX shouldn't our there. valued stock our between you slide now out So think about the that not. get we no on side want but when to get there's that to took we're stocks properly parts that sum if do our the got our shouldn't the stock of when job

So we'll can. all we do

Henry Coffey

you. Thank Great.

Michael Nierenberg

you. Thank

Operator

concludes answer Nierenberg like remarks. closing question to would back This Michael conference I for our over the any session. to and turn

Michael Nierenberg

care. forward well, your everybody we So don't where thanks the always continue drive catching Take to have a look think would everybody support, we're to value to like for of that I up with I great and the It goes rest everybody think results, book soon. quick, to headed. questions. summer. the about Stay Henry, your time rush and

Operator

presentation. now today's you Thank has The for attending concluded. conference

now may You disconnect.